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Yahoo
14-06-2025
- Business
- Yahoo
Starbucks service plan prompts surprising analyst stock-price-target revisions
Starbucks service plan prompts surprising analyst stock-price-target revisions originally appeared on TheStreet. Have a seat and let Brian Niccol tell you all about his big ideas for Starbucks () . Actually, seats are a part of the "Back to Starbucks" plan as the chief executive of the world's largest coffee chain looks to turn around a decline in foot traffic and sales. 💵💰Don't miss the move: Subscribe to TheStreet's free daily newsletter 💰 Niccol, who joined from Chipotle in September, said that pulling back on in-store seating was one of the company's biggest missteps, and he wants to fix that. "We had this strategy that I think was just a misfire of a purpose-driven store. It's like, well, the purpose is community connection," Niccol told Axios. "I think that's what got us off our game. We've got to get the seats back." Niccol made his comments during the company's Leadership Experience in Las Vegas, where Starbucks hosted more than 14,000 store managers. "It's time for us to lead again," Niccol told the crowd. "We're going to lead in warm, welcoming coffee houses. We're going to lead in innovation. Innovation to our menu." In the past several months Starbucks reintroduced condiment bars and ceramic mugs for in-house sipping, brought back handwritten notes on to-go cups and bags to foster better customer-barista connections, and returned free in-café refills to make its coffee shops feel more like homes. The Seattle coffee giant also refreshed and simplified its menu, discontinuing 13 items and eliminating extra charges for milk alternatives. In addition, the company plans to add full-time assistant managers across the U.S. to help busy stores run more smoothly. Former Starbucks CEO Howard Schultz reportedly was so thrilled with the strategy that he "did a cartwheel in my living room" the first time he heard about it. "It was so brilliant. It's short, to the point and it's exactly to the tip of the spear who we should be and who we are," Schultz said. "And we are, above all else, a coffee company."Niccol told Reuters that he would accelerate the rollout of the coffeehouse chain's new staffing and service model, aiming for all North American stores by summer's end. The initial plan called for just a third of U.S. stores by fiscal year-end. The Green Apron model includes in-store technology to more efficiently sequence orders, as well as dedicated baristas for drive-through orders. Starbucks initially rolled out the service changes to 700 stores. From a single store in Seattle in 1971, the company now has more than 40,000 outlets worldwide. During the company's April 29 quarterly earnings call, Niccol said it would be introduced in a third of U.S. stores by fiscal year-end. Starbucks used the Las Vegas event to unveil a generative AI assistant created with Microsoft () Azure's OpenAI, according to CNBC. It plans to roll out the system to 35 locations in June. A broad launch of what it calls the Green Dot Assist platform across the U.S. and Canada is slated for the company's fiscal 2026, which starts in the fall. Starbucks stock is up 3.1% in 2025 and up nearly 18% from a year ago. Citi analyst Jon Tower raised the investment firm's price target on Starbucks to $95 from $84 and affirmed a neutral rating on the shares, according to The Fly. The analyst also added an "upside 90-day short-term view" on Starbucks. The company's pull-forward of labor investment back into stores will likely lead traffic to recover more quickly, the analyst estimates. Tower said that while the cost of this investment remains unclear, the improvement in one-year traffic trends, particularly given soft comparisons, will likely drive the shares higher in the near he also said Starbucks's turnaround narrative remains "this will take time," as sales are emphasized before profit margins, and its long-term profitability remains unclear. RBC Capital boosted its price target on Starbucks to $100 from $95 while reiterating an outperform rating. The firm said it was encouraged following the presentations at the company's Leadership Experience. The accelerated labor deployment in particular suggests that management has increased confidence in their new strategy, translating to potential upside in revenue, RBC said. Ahead of the event, investors' expectations around fiscal 2026 earnings per share were depressed, since they considered that it would be another investment year, followed by more material traffic improvement in fiscal 2027, RBC service plan prompts surprising analyst stock-price-target revisions first appeared on TheStreet on Jun 14, 2025 This story was originally reported by TheStreet on Jun 14, 2025, where it first appeared. Sign in to access your portfolio
Yahoo
13-06-2025
- Business
- Yahoo
Starbucks unveils generative AI assistant to support baristas
Starbucks has announced the launch of Green Dot Assist, a generative AI-powered virtual assistant designed to support baristas in real-time. The solution allows partners to ask questions on in-store iPads verbally or via the keyboard and obtain conversational and instant replies, streamlining access to information needed during work. Green Dot Assist offers guidance on drink ingredients, equipment troubleshooting and staffing issues. Starbucks is piloting the AI assistant in 35 coffeehouses, with more to follow. Its launch is a step forward in the chain's focus on decreasing friction, streamlining operations and providing time for partners to prepare beverages and connect with clients. The coffee giant showcased the technology to more than 14,000 North American store managers at its Leadership Experience in Las Vegas. A broad launch is planned across Canada and the US by the chain's fiscal year 2026. Starbucks chief technology officer Deb Hall Lefevre was quoted by CNBC: 'It's just another example of how innovation technology is coming into service of our partners and making sure that we're doing all we can to simplify the operations, make their jobs just a little bit easier, maybe a little bit more fun, so that they can do what they do best.' In addition to Green Dot Assist, Starbucks is previewing its next-generation point-of-sale (POS) system, which aims to improve order accuracy, uptime [the time in which machinery is in operation] and partner workflow. The chain is testing pilot menu innovations via the Starting Five programme, in which select locations in the US trial new products. The introduction of the AI assistant follows a recent leadership reshuffle at Starbucks, with North America chief coffeehouse officer Mike Grams promoted to chief operating officer (COO). The chain has also unveiled a strategic price decrease for its tea-based beverages in its second-largest market, China. "Starbucks unveils generative AI assistant to support baristas" was originally created and published by Verdict Food Service, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site.
Yahoo
13-06-2025
- Business
- Yahoo
Starbucks (SBUX) Jumps 4% on AI Barista Assistant Rollout With Microsoft
Starbucks (SBUX, Financials) gained 4.3% to close at $95.39 Wednesday after unveiling a generative AI assistant developed with Microsoft's Azure OpenAI platform. The move is part of the company's effort to streamline cafe operations and boost U.S. sales. Dubbed Green Dot Assist, the tool will begin testing in 35 stores this month and is expected to expand across the U.S. and Canada in fiscal 2026. Baristas will be able to use a tablet to ask questions via voice or text, receiving real-time support on drink prep and equipment troubleshooting. CEO Brian Niccol's turnaround strategy aims to shorten service times to four minutes and refocus the company on its core brand. The new AI assistant is designed to help staff work more efficiently by reducing reliance on manuals or internal systems. Chief Technology Officer Deb Hall Lefevre said the assistant could eventually create IT tickets automatically or suggest shift changes, further integrating into store operations. The Microsoft (MSFT, Financials) partnership comes nearly a year after CEO Satya Nadella stepped down from Starbucks' board. The system includes a grounding engine to prevent AI inaccuracies, or hallucinations. The company also showcased next-generation Mastrena espresso machines and a simplified point-of-sale system that allows experienced baristas to get up to speed within an hour and helps personalize customer experiences. Other restaurant chains have tested AI with varied outcomes. Yum Brands has partnered with Nvidia on AI vision tools, while McDonald's recently ended an AI drive-thru test with IBM due to performance issues. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
13-06-2025
- Business
- Yahoo
Starbucks' new game plan to roll out AI chatbots at cafés could serve as a ‘litmus test' for the industry, analyst says
As continues its 'get back to Starbucks' plan to revive slumping sales, the company announced it will implement an OpenAI-powered chatbot to remind baristas of drink recipes and assist them with equipment troubleshooting. Analysts told Fortune the move could help streamline hiring and efficiency, but it also carries with it the pitfalls of AI, including the potential for hallucinations and outages. Starbucks is betting on AI to give its baristas some extra help behind the counter. The Seattle-based coffee chain announced Tuesday the launch of 'Green Dot Assist,' an AI-powered virtual assistant intended to simplify baristas' jobs and fulfill orders faster. Starbucks will pilot the technology created with Microsoft Azure's OpenAI platform at 35 locations and will roll it out nationwide next year. The AI assistant will pull recipe cards of drinks to show baristas how to make them, as well as suggesting swaps if ingredients run out, the company said. The tech will also suggest food pairings to suggest to customers, provide troubleshooting support for malfunctioning equipment, and help managers find employees to backfill shifts should a store be short-staffed. 'It's just another example of how innovation technology is coming into service of our partners and making sure that we're doing all we can to simplify the operations, make their jobs just a little bit easier—maybe a little bit more fun—so that they can do what they do best,' Starbucks chief technology officer Deb Hall Lefevre told CNBC. Starbucks first announced the tech at its Leadership Experience event on Tuesday, when it also unveiled plans to expand the position of assistant manager by adding the role to 'most company-operated stores in the U.S,' hiring about 90% of management internally. The swath of labor changes are the latest in CEO Brian Niccol's efforts for the company to 'get back to Starbucks' and revive its cozy-coffeehouse reputation amid slumping sales. The company reported in April its fourth straight quarter of same-store sales declines, in part a result of economic uncertainty putting a damper on demand. As part of the turnaround efforts, Starbucks will have to draw on its big brand name and past goodwill from customers to refocus on what made the chain popular to begin with. 'All brands drift over time, and I have pattern recognition,' Starbucks CFO Cathy Smith told Fortune in April. 'I've seen this with a number of brands, and the great ones recapture what made them great.' The move follows the lead of other restaurant chains deploying AI. Yum! Brands, the conglomerate behind KFC and Taco Bell, has partnered with Nvidia to take drive-thru and digital orders. McDonald's, however, cancelled its contract with IBM after two years and returned humans to drive-thru order-taking. While restaurants have had mixed results with AI, analysts see Starbucks' recent moves to leverage the technology as largely positive, so long as the company uses it effectively. Logan Reich, an analyst at RBC Capital, told Fortune that while the introduction of an AI chatbot won't be instrumental in increasing revenue, it can help train and onboard staff more efficiently, particularly as the company invests in internal promotions and giving employees more hours. Announcing new management opportunities alongside implementation of AI tools also sends the signal to workers that AI won't be taking their jobs anytimes soon, according to Gadjo Sevilla, a senior AI and tech analyst at eMarketer. 'What they're trying to show here is that, with regard to adoption, is that they can make it work with longtime staff,' Sevilla told Fortune. 'So it's not replacing jobs, it's enhancing jobs, with regards to the new hires.' But as with any rollout including AI, Starbucks may experience hiccups like hallucinations. 'Making sure that the chatbot is accurate and providing in an accurate way and not causing more issues—I think that's going to be a critical aspect of rolling out to a broad storebase,' Reich said. Sevilla warned the tech may experience more profound problems, from security breaches to outages—like the one ChatGPT experienced Tuesday—that are associated with a company using tools outside its immediate premises. As more restaurants figure out how to integrate AI into their point of sale, they may look to see how effective Starbucks was in leveraging the tech. 'This is going to be a litmus test for AI integration at this scale,' Sevilla said. This story was originally featured on Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Globe and Mail
11-06-2025
- Business
- Globe and Mail
Starbucks (SBUX) Unveils New AI Assistant for Baristas That's Powered by Microsoft
Coffee making is going high tech. Confident Investing Starts Here: Easily unpack a company's performance with TipRanks' new KPI Data for smart investment decisions Receive undervalued, market resilient stocks right to your inbox with TipRanks' Smart Value Newsletter Starbucks (SBUX) is rolling out a new generative artificial intelligence (AI) assistant for its coffee baristas that's powered by Microsoft (MSFT) Azure's OpenAI platform. The AI assistant will initially be deployed in a trial at 35 Starbucks locations in the U.S. as part of a strategy to simplify baristas' jobs and speed-up service at the company's coffee shops. The global coffee chain showed off the new technology to more than 14,000 North American store managers at an event held in Las Vegas, Nevada on June 10. A broader rollout of what Starbucks is calling the 'Green Dot Assist' platform across the U.S. and Canada is slated to begin this autumn. News of the AI assistant comes as Starbucks tries to revive its sluggish sales under new CEO Brian Niccol. Improved Service Niccol has set a goal of improving Starbucks' service times to four minutes per order. The hope is that quick, accurate answers to barista questions will help speed-up service and improve quality at Starbucks locations. With the AI assistant, Starbucks' baristas will be able to use a tablet to get answers to questions such as how to make an iced espresso and troubleshoot equipment errors. As the AI assistant evolves, Starbucks has even bigger plans for its use, including automatically creating a ticket with information technology (IT) for equipment issues. Starbucks is expanding its relationship with Microsoft about a year after the tech giant's CEO Satya Nadella stepped down from Starbucks' board of directors. SBUX stock has risen 2% this year. Is SBUX Stock a Buy? The stock of Starbucks has a consensus Moderate Buy rating among 23 Wall Street analysts. That rating is based on 12 Buy and 11 Hold recommendations issued in the last three months. The average SBUX price target of $93.25 implies 1.99% upside from current levels.
